Exhibit 99.1

FORWARD AIR CORPORATION REPORTS RECORD SECOND QUARTER RESULTS
“COMPLETING THE MODEL” INITIATIVES CONTINUE TO GAIN TRACTION


GREENEVILLE, Tenn.—(BUSINESS WIRE)—July 21, 2008—Forward Air Corporation (NASDAQ:FWRD) today reported record revenue, operating income, net income and diluted earnings per share for the second quarter and six months ended June 30, 2008.

Operating revenue for the quarter ended June 30, 2008 increased 30.5% to $121.6 million from $93.1 million for the same quarter in 2007.  Income from operations was $20.3 million, compared with $18.3 million in the prior-year quarter, an increase of 10.6%.  As a percent of operating revenue, income from operations decreased to 16.7% from 19.7% for the same quarter last year.  Net income during the period increased by $0.6 million, or 5.5%, to $12.1 million from $11.5 million in the prior-year quarter.  Income per diluted share from operations for the second quarter of 2008 was $0.42 compared with $0.38 in the prior-year quarter, an increase of 10.5%.

Operating revenue for the six months ended June 30, 2008 increased 27.1% to $229.5 million from $180.5 million for the same period in 2007.  Income from operations was $36.9 million, compared with $34.2 million in the prior-year period, an increase of 8.1%.  As a percent of operating revenue, income from operations decreased to 16.1% for the first six months of 2008 from 18.9% in 2007.  Net income during the period increased 1.6% to $22.1 million from $21.8 million in the prior-year period.  Income per diluted share from operations for the first six months of 2008 was $0.76 compared with $0.72 in the prior-year period, an increase of 5.6%.

Bruce Campbell, Chairman, President and CEO, commented, “Within our Forward Air, Inc operating segment, which includes our core airport-to-airport network, we experienced continued success with our Completing the Model strategic initiatives. Most notably, our TLX truckload brokerage and our Forward Air Complete door-to-door pick-up and delivery offering were key contributors. The success of these initiatives along with improved freight volumes and disciplined cost control by our team enabled us to post record results in the most challenging of economic times.”

Commenting further, Mr. Campbell said, “Our Forward Air Solutions segment, which is our pool distribution offering, continued executing their 2008 growth plan by expanding their geographic footprint into Texas. Two of the new locations, Dallas and Houston, resulted from our previously announced (March 17, 2008) asset purchase of  Pinch Transport (and related companies) while the third new location, San Antonio, was a de novo expansion, driven by strong customer demand. We will continue to emphasize our geographic expansion strategy in this important product line for the balance of 2008.”

In commenting on the third quarter, Rodney L. Bell, Senior Vice President and CFO, said, “We anticipate third quarter year-over-year revenue growth in the 22 to 27% range. Additionally, we expect income per diluted share for the third quarter to be $0.40 to $0.44.

Review of Financial Results

Forward Air will hold a conference call to discuss second quarter 2008 results on Tuesday, July 22, 2008 at 9:00 a.m. EDT.  The Company’s conference call will be available online at www.forwardair.com or by dialing 866.356.4441.  A replay of the conference call will be available at www.forwardair.com beginning shortly after the completion of the live call.

About Forward Air

Forward Air is a high-service-level contractor to the air cargo industry providing time-definite ground transportation services through a network of 83 terminals located on or near major airports in the United States and Canada.  The Company provides these services as a cost-effective alternative to air transportation of cargo that must be delivered at a specific time but is relatively less time-sensitive than traditional air freight or when air transportation is not economical.
 

 
Forward Air Corporation
  
Condensed Consolidated Statements of Income
  
(In thousands, except per share data)
  
(Unaudited)
  
                         
   
Three months ended
    
Six months ended
  
   
June 30,
    
June 30,
    
June 30,
    
June 30,
  
   
2008
    
2007
    
2008
    
2007
  
Operating revenue:
                        
Forward Air
                        
   Airport-to-airport
   $ 89,187     $ 77,237     $ 171,246     $ 151,458  
   Logistics
     14,838       10,680       27,091       18,865  
   Other
     6,188       5,230       11,977       10,178  
Forward Air Solutions
                                
   Pool distribution
     11,350       --       19,187       --  
Total operating revenue
     121,563       93,147       229,501       180,501  
                                 
Operating expenses:
                                
Purchased transportation
                                
Forward Air
                                
   Airport-to-airport
     33,472       29,739       65,011       60,271  
   Logistics
     10,818       8,150       19,998       14,296  
   Other
     1,572       1,477       3,205       2,773  
Forward Air Solutions
                                
   Pool distribution
     2,069       --       3,242       --  
      Total purchased transportation
     47,931       39,366       91,456       77,340  
      Salaries, wages and employee benefits
     29,404       19,964       55,851       38,977  
      Operating leases
     5,884       3,882       10,735       7,617  
      Depreciation and amortization
     3,998       2,494       7,696       4,874  
      Insurance and claims
     1,614       1,900       3,874       3,602  
      Fuel expense
     3,289       271       5,413       509  
      Other operating expenses
     9,181       6,957       17,564       13,429  
Total operating expenses
     101,301       74,834       192,589       146,348  
Income from operations
     20,262       18,313       36,912       34,153  
                                 
Other income (expense):
                                
   Interest expense
     (328 )     (41 )     (629 )     (81 )
   Other, net
     56       469       210       1,221  
Total other income (expense)
     (272 )     428       (419 )     1,140  
Income before income taxes
     19,990       18,741       36,493       35,293  
Income taxes
     7,888       7,266       14,383       13,525  
Net income
   $ 12,102     $ 11,475     $ 22,110     $ 21,768  
                                 
Net income per share:
                                
Basic
   $ 0.42     $ 0.38     $ 0.77     $ 0.72  
Diluted
   $ 0.42     $ 0.38     $ 0.76     $ 0.72  
Dividends
   $ 0.07     $ 0.07     $ 0.14     $ 0.14  
Weighted average shares outstanding:
                                
Basic
     28,805       29,805       28,737       30,070  
Diluted
     29,126       30,162       29,041       30,412  
 
 
2

 
Forward Air Corporation
  
Condensed Consolidated Balance Sheet
  
(In thousands, except per share data)
  
(Unaudited)
  
             
   
June 30,
    
December 31,
  
   
2008
    
2007 (a)
  
Assets
            
Current assets:
            
   Cash
   $ 1,082     $ 4,909  
   Accounts receivable, net
     75,973       59,734  
   Other current assets
     9,153       6,807  
Total current assets
     86,208       71,450  
                 
Property and equipment
     160,988       158,354  
Less accumulated depreciation and amortization
     57,240       55,322  
Total property and equipment, net
     103,748       103,032  
Goodwill and other acquired intangibles:
                
   Goodwill
     45,045       36,053  
   Other acquired intangibles, net
     37,067       29,991  
Total goodwill and other acquired intangibles
     82,112       66,044  
Other assets
     1,955       1,358  
Total assets
   $ 274,023     $ 241,884  
                 
Liabilities and Shareholders’ Equity
                
Current liabilities:
                
   Accounts payable
   $ 13,512     $ 11,714  
   Accrued expenses
     16,688       14,274  
   Current portion of debt and capital lease obligations
     592       830  
Total current liabilities
     30,792       26,818  
                 
Debt and capital lease obligations, less current portion
     36,441       31,486  
Other long-term liabilities
     2,740       4,476  
Deferred income taxes
     8,138       7,371  
                 
Shareholders’ equity:
                
   Common stock
     288       286  
   Additional paid-in capital
     6,106       --  
   Retained earnings
     189,518       171,447  
Total shareholders’ equity
     195,912       171,733  
Total liabilities and shareholders’ equity
   $ 274,023     $ 241,884  

(a) Taken from audited financial statements, which are not presented in their entirety
 
 
3

 
Forward Air Corporation
  
Condensed Consolidated Statement of Cash Flows
  
(In thousands)
  
(Unaudited)
  
             
   
Six months ended
  
   
June 30,
    
June 30,
  
   
2008
    
2007
  
Operating activities:
            
Net Income
   $ 22,110     $ 21,768  
Adjustments to reconcile net income to net cash provided by operating activities
                
   Depreciation and amortization
     7,696       4,874  
   Share-based compensation
     3,120       1,483  
   Loss (gain) on sale of property and equipment
     21       (235 )
   Provision for loss (recovery) on receivables
     113       (114 )
   Provision for revenue adjustments
     1,904       1,165  
   Deferred income taxes
     1,428       1,514  
   Tax benefit for stock options exercised
     (1,079 )     (8 )
   Changes in operating assets and liabilities
                
      Accounts receivable
     (18,301 )     (4,312 )
      Prepaid expenses and other current assets
     (2,371 )     1,347  
      Accounts payable and accrued expenses
     2,514       (2,240 )
Net cash provided by operating activities
     17,155       25,242  
                 
Investing activities:
                
Proceeds from disposal of property and equipment
     33       273  
Purchases of property and equipment
     (5,355 )     (38,535 )
Proceeds from sales or maturities of available-for-sale securities
     --       126,635  
Purchases of available-for-sale securities
     --       (75,560 )
Acquisition of business
     (18,646 )     --  
Other
     (93 )     (676 )
Net cash (used in) provided by investing activities
     (24,061 )     12,137  
                 
Financing activities
                
Payments on debt and capital lease obligations
     (870 )     (19 )
Borrowings on line of credit
     30,000       --  
Payments on line of credit
     (25,000 )     --  
Proceeds from exercise of stock options
     2,138       275  
Payments of cash dividends
     (4,036 )     (4,222 )
Common stock issued under employee stock purchase plan
     145       138  
Repurchase of common stock
     --       (31,220 )
Cash settlement of share-based awards for minimum tax withholdings
     (377 )     (234 )
Tax benefit for stock options exercised
     1,079       8  
Net cash provided by (used in) financing activities
     3,079       (35,274 )
Net (decrease) increase in cash
     (3,827 )     2,105  
Cash at beginning of period
     4,909       8,231  
Cash at end of period
   $ 1,082     $ 10,336  

 
4

 
Forward Air Corporation
Segment Information
(In millions)
(Unaudited)
                         
 
Three months ended
   
June 30,
    
Percent of
      
June 30,
  
Percent of
  
   
2008
    
Revenue
      
2007
  
Revenue
  
Operating revenue
                        
      Forward Air
$
110.9
    
91.2
%
  
$
93.1
  
100.0
%
      FASI
  
11.4
    
9.4
      
--
  
--
  
      Intercompany Eliminations
  
(0.7
)
  
(0.6
)
    
--
  
--
  
            Total
  
121.6
    
100.0
      
93.1
  
100.0
  
                         
Purchased transportation
                        
      Forward Air
  
45.9
    
41.4
      
39.4
  
42.3
  
      FASI
  
2.7
    
23.7
      
--
  
--
  
      Intercompany Eliminations
  
(0.7
)
  
100.0
      
--
  
--
  
            Total
  
47.9
    
39.4
      
39.4
  
42.3
  
                         
Salaries, wages and employee benefits
                        
      Forward Air
  
24.7
    
22.3
      
19.9
  
21.4
  
      FASI
  
4.7
    
41.2
      
--
  
--
  
            Total
  
29.4
    
24.2
      
19.9
  
21.4
  
                         
Operating leases
                        
      Forward Air
  
4.6
    
4.2
      
3.9
  
4.2
  
      FASI
  
1.3
    
11.4
      
--
  
--
  
            Total
  
5.9
    
4.8
      
3.9
  
4.2
  
                         
Depreciation and amortization
                        
      Forward Air
  
3.6
    
3.2
      
2.5
  
2.7
  
      FASI
  
0.4
    
3.5
      
--
  
--
  
            Total
  
4.0
    
3.3
      
2.5
  
2.7
  
                         
Insurance and claims
                        
      Forward Air
  
1.6
    
1.4
      
1.9
  
2.0
  
      FASI
  
--
    
--
      
--
  
--
  
            Total
  
1.6
    
1.3
      
1.9
  
2.0
  
                         
Fuel expense
                        
      Forward Air
  
1.8
    
1.6
      
0.3
  
0.3
  
      FASI
  
1.5
    
13.2
      
--
  
--
  
            Total
  
3.3
    
2.7
      
0.3
  
0.3
  
                         
Other operating expenses
                        
      Forward Air
  
8.0
    
7.2
      
6.9
  
7.4
  
      FASI
  
1.2
    
10.5
      
--
  
--
  
            Total
  
9.2
    
7.6
      
6.9
  
7.4
  
                         
Income (loss) from operations
                        
      Forward Air
  
20.7
    
18.7
      
18.3
  
19.7
  
      FASI
  
(0.4
)
  
(3.5
)
    
--
  
--
  
            Total
$
20.3
    
16.7
%
  
$
18.3
  
19.7
%
 
 
5

 
Forward Air Corporation
Segment Information
(In millions)
(Unaudited)
                         
 
Six months ended
   
June 30,
    
Percent of
      
June 30,
  
Percent of
  
   
2008
    
Revenue
      
2007
  
Revenue
  
Operating revenue
                        
      Forward Air
$
211.2
    
92.0
%
  
$
180.5
  
100.0
%
      FASI
  
19.2
    
8.4
      
--
  
--
  
      Intercompany Eliminations
  
(0.9
)
  
(0.4
)
    
--
  
--
  
            Total
  
229.5
    
100.0
      
180.5
  
100.0
  
                         
Purchased transportation
                        
      Forward Air
  
88.2
    
41.8
      
77.4
  
42.9
  
      FASI
  
4.1
    
21.4
      
--
  
--
  
      Intercompany Eliminations
  
(0.9
)
  
100.0
      
--
  
--
  
            Total
  
91.4
    
39.8
      
77.4
  
42.9
  
                         
Salaries, wages and employee benefits
                        
      Forward Air
  
47.3
    
22.4
      
38.9
  
21.6
  
      FASI
  
8.6
    
44.8
      
--
  
--
  
            Total
  
55.9
    
24.3
      
38.9
  
21.6
  
                         
Operating leases
                        
      Forward Air
  
8.9
    
4.2
      
7.6
  
4.2
  
      FASI
  
1.8
    
9.4
      
--
  
--
  
            Total
  
10.7
    
4.7
      
7.6
  
4.2
  
                         
Depreciation and amortization
                        
      Forward Air
  
7.0
    
3.3
      
4.9
  
2.7
  
      FASI
  
0.7
    
3.6
      
--
  
--
  
            Total
  
7.7
    
3.4
      
4.9
  
2.7
  
                         
Insurance and claims
                        
      Forward Air
  
3.4
    
1.6
      
3.6
  
2.0
  
      FASI
  
0.5
    
2.6
      
--
  
--
  
            Total
  
3.9
    
1.7
      
3.6
  
2.0
  
                         
Fuel expense
                        
      Forward Air
  
3.1
    
1.4
      
0.5
  
0.3
  
      FASI
  
2.3
    
12.0
      
--
  
--
  
            Total
  
5.4
    
2.4
      
0.5
  
0.3
  
                         
Other operating expenses
                        
      Forward Air
  
15.4
    
7.3
      
13.4
  
7.4
  
      FASI
  
2.1
    
10.9
      
--
  
--
  
            Total
  
17.5
    
7.6
      
13.4
  
7.4
  
                         
Income (loss) from operations
                        
      Forward Air
  
37.9
    
18.0
      
34.2
  
18.9
  
      FASI
  
(0.9
)
  
(4.7
)
    
--
  
--
  
            Total
$
37.0
    
16.1
%
  
$
34.2
  
18.9
%
 
 
6
 
Important Information

This press release contains “forward-looking statements,” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance.  Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects” or “expects.”  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward-looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, our inability to maintain our historical growth rate because of a decreased volume of freight moving through our network or decreased average revenue per pound of freight moving through our network, increasing competition and pricing pressure, surplus inventories, loss of a major customer, the creditworthiness of our customers and their ability to pay for services rendered, our ability to secure terminal facilities in desirable locations at reasonable rates, the inability of our information systems to handle an increased volume of freight moving through our network, changes in fuel prices, claims for property damage, personal injuries or workers’ compensation, employment matters including rising health care costs, enforcement of and changes in governmental regulations, environmental and tax matters, the handling of hazardous materials, the availability and compensation of qualified independent owner-operators and freight handlers needed to serve our transportation needs and our inability to successfully integrate acquisitions.  As a result of the foregoing, no assurance can be given as to future financial condition, cash flows or results of operations.  We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

-END-
 
CONTACT:    
 
 
Forward Air Corporation
 
 
Rodney L. Bell, 423-636-7000
 
 
rbell@forwardair.com